Archives for March 2014

The EEOC Takes Aim at Employee Separation Agreements

In February 2014, the EEOC’s Chicago District Office filed suit against CVS Pharmacy alleging its standard employee separation agreement violates Title VII of the Civil Rights Act because it contained language that could be construed to interfere with an employee’s right to file charges, cooperate or communicate with the EEOC (or comparable state or local agencies).

Even though CVS’s form agreement includes a disclaimer preserving the employee’s right to file an administration charge of discrimination or participate in a government investigation, the EEOC argues the following provisions deny employees full exercise of their Title VII rights:  (1) a cooperation clause requiring the employee to notify CVS if contacted about an administrative investigation; (2) a non-disparagement provision prohibiting the employee from making disparaging remarks about CVS or its employees; (3) a non-disclosure provision prohibiting the employee from disclosing CVS’s confidential information; (4) a general release of claims; and (5) a covenant not to sue.  Presumably, your organization’s separation agreement includes some or all of these provisions.

The outcome of this lawsuit will not be known for some time.  However, win or lose, this lawsuit represents a new and aggressive effort by the EEOC to attack what most employers would consider boilerplate separation agreement language.  It may be time to review your organization’s agreement to get ahead of a potential legal challenge.